How Much Should a Company Spend on Marketing?

The annual survey of chief marketing officers offers some answers. They asked what percentage of revenue is devoted to marketing budgets, and the results are as follows based on type of business and what is sold:

  • Selling products to other businesses: 7.4 % of revenue
  • Selling services to other businesses: 8.6 % of revenue
  • Selling products direct to consumers: 9.1 % of revenue
  • Selling services direct to consumers: 9.3 % of revenue

Digital marketing spend next year will be allocated in the following ways, according to a research firm:

  • Search engine marketing (paid and organic SEO): 45 % of revenue
  • Online display advertising (banner and video ads): 36 % of revenue
  • Social media marketing, (paid and non-paid): 15 % of revenue
  • Email marketing activities: 4 % of revenue

These percentages represent total marketing investments, not just advertising or media spend. They include expenses for marketing staffs, fees to external agencies and suppliers and advertising costs.

Overall, digital marketing budgets are expected to grow about 12 percent over the next few years.

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